Question

Company A is offering $6,000 for the first month's salary and will increase the amount each month by $5,000. Company B is offering $700 or the first month and will double the pay each month.

Use the given table to determine for which month Company B's payment will first exceed Company A's payment?
A) Month 4
B) Month 6
C) Month 7
D) Month 9

Answer 1

The month in which Company B's payment will first exceed Company A's payment is C) Month 7.

Explanation:

Step 1:

Company A offers $6,000 for the first month and increases the salary each month by $5,000.

Company B offers $700 for the first month but doubles the payments each month.

We need to determine which month company B's payment is greater than company A's payment.

Step 2:

According to the table, at month 6 company A pays $31,000 while company B pays $22,400.

However after this month, in the seventh-month company A pays $36,000 while company B pays $44,800, which is higher than company A's salary.

So The month in which Company B's payment will first exceed Company A's payment is C) Month 7.